Results presentation FY2013 · 2013-03-31 · FY 13 highlights Full year distribution of 99.99 cpu – 7.5% increase on prior year Final distribution of 53.16 cpu – up 7.9% on 2012

Results presentation FY2013 May 2013

• Overview

• Acquisitions

• Financial review

• Operational review

• Long-term focus • Growth over time • Sustainable income

Focus to property fundamentals

• Ongoing investment on existing portfolio • Asset management resource • Key letting activity and asset management function

Intense about asset management

• Investec Property’s pipeline • Relationship driven • Investec Group synergy

Leverage the Investec network

• Proven track record • Invest in quality people ahead of the growth curve

Experienced management team

• Continuous pursuit of opportunities • Awareness of competitive pricing • Asset growth to mitigate risk and to compete

Growth over time

IPF at a glance

PUT PLS

Source: I Net Bridge as at 13 May 2013

Comparative forward yields analysis 6.

3%

6.2%

6.3%

7.8%

7.3%

3.8%

4.3%

4.9%

5.3%

5.6%

6.1%

6.3%

6.1%

6.2%

7.1%

6.4%

7.4%

7.4%

7.3%

7.9%

7.7%

7.7%

7.8%

7.9%

7.7%

7.8%

7.4%

8.0%

8.3%

8.0%

10.2

%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

Foun

tain

head

Syco

m

Capi

tal

Emira

SA C

orpo

rate

Fort

ress

B

Hosp

italit

y B

Resil

ient

Grow

thpo

int

Hypr

op

Inve

stec

Acuc

ap

Prem

ium

Rede

fine

Asce

nsio

n B

Oct

odec

Vuna

ni

Vuki

le

Arro

whe

ad B

Syne

rgy

A

Fort

ress

A

Arro

whe

ad A

Annu

ity

Dipu

la B

Hosp

italit

y A

Dipu

la A

Rebo

sis

Syne

rgy

B

Asce

nsio

n A

Delta

Vivi

dend

Forward yield on clean price PUT Weighted Average (6.7%) PLS Weighted Average (5.9%) Sector Weighted Average (6.2%)

Forward yield vs. price / NAV

Capital

Emira

Fountainhead

SA Corporate

Sycom

Acucap

Annuity Arrowhead A

Arrowhead B

Ascension A

Ascension B Dipula A

Dipula B

Fortress A

Growthpoint

Hospitality A

Hyprop

IPF (today)

Octodec

Premium

Rebosis

Redefine

Resilient

Synergy A

Synergy B

Vividend

Vunani Vukile

IPF (1 year ago)

4.0%

5.0%

6.0%

7.0%

8.0%

9.0%

10.0%

0.80 1.00 1.20 1.40 1.60 1.80 2.00

12-m

onth

rolli

ng fo

rwar

d yi

eld

(%)

Price / NAV

FY 13 highlights

Full year distribution of 99.99 cpu – 7.5% increase on prior year

Final distribution of 53.16 cpu – up 7.9% on 2012

Portfolio doubled to R4.2 billion carrying value

R1.5 billion of new equity raised - oversubscribed rights offer

R3 billion DMTN programme in place – R450 million utilised

Low gearing of 10.7%

Strong underlying property fundamentals – vacancy low at 2.9%

15% increase in tangible net asset value per unit

Corporate and secured credit ratings upgraded – now A- and AA- respectively

Fund snapshot at 31 March 2013

Number of Properties 50

Market Capitalisation R5.2 billion

Asset Value R4.2 billion

GLA 568,151 m2

Vacancies 2.9%

Gearing 10.7%

NAV per Unit R12.59

Unit Price R16.21

Premium to NAV 28.8%

Asset growth since listing

R 1.7 billion 29 properties

R1.7 billion 29 properties




-

0.50

1.00

1.50

2.00

2.50

3.00

3.50

4.00

4.50

April '11 September '11 March '12 September '12 March '13

R b

illio

ns

Distribution growth

43.73 49.29

93.02 +7.1%

46.83

+7.9%

53.16

+7.5%

99.99

0

20

40

60

80

100

120

First Half Second Half Full year

cpu

2012 2013

• Overview

• Acquisitions



Acquisition summary

Property name Location Sector GLA (m2) Cost of acqn

Date of acqn

Great North Road Plaza Musina Retail 13,561 R 145,000,000 06 June 2012

General Electric Midrand Industrial 11,180 R 119,057,332 25 July 2012

The Firs Rosebank Office 13,787 R 272,300,000 01 October 2012

Investec Pretoria Pretoria Office 6,301 R 169,952,295 01 November 2012

Balfour Park Shopping Centre Johannesburg Retail 36,311 R 295,819,187 01 December 2012

Megamark Mall Kriel Retail 23,103 R 202,315,484 11 December 2012

Nonkqubela Mall Khayelitsha Retail 7,787 R 99,399,064 14 December 2012

BMW Boksburg Boksburg Retail 7,526 R 62,500,000 20 December 2012

Giuricich Portfolio Gauteng, Free State,

Limpopo Retail 70,782 R 742,800,000December 2012 -

February 2013

Giuricich Properties Plastic Land Fourways Tile World Supa Quick Fourways

Physical address Cnr Sunrise Boulevard & William Nicol, Fourways

GLA 1,296m2

Tenancy Single-tenanted WALE (by GLA) 3.2 years Approx. age of building 11 years Cost of acquisition R13,000,000 Major tenants Plastic Land

Physical address Cnr Sunrise Boulevard & William Nicol, Fourways

GLA 2,400m2 Tenancy Multi-tenanted WALE (by GLA) 2.2 years Approx. age of building 11 years Cost of acquisition R23,500,000

Major tenants Dial a bed, Tile World, Supa Quick

Giuricich Properties Unitrans Polokwane Wetherly's and Chateaux D’Ax Bryanston

Physical address 204 Tagore Street, Polokwane

GLA 4,322m2

Tenancy Single-tenanted WALE (by GLA) 8.6 years Approx. age of building 4 years Cost of acquisition R20,000,000 Major tenants Unitrans Automotive

Physical address Cnr William Nicol & Bryanston Drive

GLA 6,190m2

Tenancy Multi-tenanted WALE (by GLA) 3.2 years Approx. age of building 8 years Cost of acquisition R61,000,000

Major tenants Chateaux D’Ax, Wetherly's and others

Giuricich Properties VW McCarthy Roodepoort Nissan Roodepoort

Physical address Hendrik Potgieter Rd & Jim Fouche Drive, Constantia

GLA 2,595m2

Tenancy Single-tenanted WALE (by GLA) 3.7 years Approx. age of building 8.5 years Cost of acquisition R26,000,000 Major tenants VW McCarthy

Physical address 47 Ontdekkers Rd, Roodepoort

GLA 4,893m2

Tenancy Single-tenanted WALE (by GLA) 6.6 years Approx. age of building 5.5 years Cost of acquisition R34,800,000 Major tenants Nissan (Super Group)

Giuricich Properties Super Group Greenstone Builders Warehouse Witbank

Physical address Cnr Van Riebeeck & Aitken St, Edenvale

GLA 5,686m2

Tenancy Single-tenanted WALE (by GLA) 7.1 years Approx. age of building 5 years Cost of acquisition R50,000,000

Major tenants Honda & Nissan (Super Group)

Physical address Mandela St President Park, Emalahleni

GLA 5,512m2

Tenancy Single-tenanted WALE (by GLA) 8.7 years Approx. age of building 1.5 years Cost of acquisition R80,000,000 Major tenants Builders Warehouse

Giuricich Properties Builders Warehouse Polokwane Builders Warehouse Zambesi Pretoria

Physical address 161 Crescent Drive, Polokwane

GLA 8,500m2

Tenancy Single-tenanted WALE (by GLA) 4.7 years Approx. age of building 7.5 years Cost of acquisition R93,000,000 Major tenants Builders Warehouse

Physical address 371 Veda Avenue, Montana

GLA 8,907m2

Tenancy Single-tenanted WALE (by GLA) 5.2 years Approx. age of building 7 years Cost of acquisition R104,500,000 Major tenants Builders Warehouse

Giuricich Properties Builders Warehouse Bloemfontein Builders Warehouse Tiger Wheel & Tyre The Glen

Physical address 349 Curi Avenue, Bloemfontein

GLA 9,378m2

Tenancy Multi-tenanted WALE (by GLA) 6.0 years Approx. age of building 6 years Cost of acquisition R98,000,000

Major tenants Builders Warehouse, CTM

Physical address 5 Lois Road, Gleneagles GLA 11,103m2

Tenancy Multi-tenanted WALE (by GLA) 6.0 years Approx. age of building 6.5 years Cost of acquisition R139,000,000

Major tenants Builders Warehouse,

Tiger Wheel, PG Glass, Sparkling Auto Care

Investec properties The Firs, Rosebank Investec Pretoria

Location 193 Oxford Road, Rosebank

GLA 13,787m2

Acquisition cost R272,300,000

Tenancy Multi-tenanted

Occupancy 100%

WALE (by GLA) 3.3 years

Major tenants Standard Bank, Bombela, The Grillhouse, Doppie Zero

Location Cnr Atterbury & Klarinet Streets

GLA 6,301m2


Tenancy Single-tenanted

Occupancy 100%


Major tenants Investec Bank

Investec properties Balfour Park GE Building

Location Northmid Corporate Park, Midrand

GLA 11,180m²



Occupancy 100%


Major tenants General Electric South Africa

Location Cnr Johannesburg Rd and Louis Botha Ave, Highlands North, Kensington

GLA 36,451m2



Occupancy 94.6%


Major tenants Checkers, Woolworths, Edgars, Virgin Active

Other properties Nonkquebela Mall Megamark Mall

Location Bronwyn Street, Kriel, Mpumalanga

GLA 20,848m2



Occupancy 100%


Major tenants Shoprite, Spar

Location 1 Sulani Drive, Khayelitsha

GLA 7,778m2



Occupancy 100%


Major tenants Shoprite, Standard Bank

Other properties Great North Road Plaza BMW Boksburg

Location Cnr North Rand & Pond Roads, Bardene, Boksburg North

GLA 7,526m²



Occupancy 100%


Major tenants BMW Auto Alpina

Location Cnr N1, Smelter Avenue & Harper Road, Musina

GLA 13,561



Occupancy 100%


Major tenants Checkers, Cashbuild, Woolworths

Post year end acquisitions

5 Bond Street

Location 5 Bond Street, Midrand

GLA 5,870m²



Occupancy 100%

WALE (by GLA) 10 years

Major tenants Investec

Location 32 Potgieter Street, Alrode

GLA 25,000m²



Occupancy 100%


Major tenants SA Ladder

SA Ladder

Post year end acquisitions Mionolta (2 properties)

Location Highveld, Pretoria & Bellville, Cape Town

GLA 5,121m²



Occupancy 100%


Major tenants Konica Minolta

• Overview

• Acquisitions



Distribution reconciliation

2013 2012 +/-

R'000 R'000 R'000

Profit before debenture interest 236,813 158,184 78,629

Less: Straight-line revenue adjustment (43,790) (30,507) (13,283)

Profit on disposal of investment property (39,066) 0 (39,066)

Add: Fair value adjustments 82,856 30,507 52,349

Distributable earnings before tax 236,813 158,184 78,628

Tax (66) (49) (17)

Distributable earnings 236,746 158,135 78,611 cents cents cents Interim distribution per linked unit 46.83 43.73 3.10

Final distribution per linked unit 53.16 49.29 3.87

Distribution per linked unit 99.99 93.02 6.97

Balance sheet extracts 2013 2012 +/- R'000 R'000 R'000 ASSETS Non current assets 4,187,000 2,065,400 2,121,600 Current assets 452,343 16,631 435,712 Trade and other receivables 53,613 12,064 41,550 Cash and cash equivalents 398,730 4,567 394,162 Total assets 4,639,343 2,082,031 2,557,312 EQUITY AND LIABILITIES Equity - ordinary share capital 3,172 1,700 1,472 Fair value of debentures 3,940,004 1,836,379 2,103,625 Total unitholders' interest 3,943,176 1,838,079 2,105,097 Other non-current liabilities 455,294 1,169 454,124 Loans 450,000 1,169 448,831 Derivatives 5,294 - 5,294 Current liabilities 240,873 242,786 (1,913) Total equity and liabilities 4,639,343 2,082,034 2,557,309 Linked units in issue 317,220,000 170,000,000 147,220,000 cents cents cents Net asset value per linked unit 1,243.04 1,081.22 161.82

Cash flow

2013 2012 +/- R'000 R'000 R'000 Cash generated from operations 236,976 173,486 63,490 Finance income received 20,712 3,016 17,696 Finance costs paid (29,887) (2,285) (27,602) Taxation paid (28) (52) 24 Distribution paid to unitholders (163,404) (74,346) (89,058) Net cash inflow from operating activities 64,369 99,819 (35,450) Net cash outflow from investing activities (1,485,664) (1,926,152) 440,488 Net cash inflow from financing activities 1,815,458 1,830,900 (15,442) Net increase in cash and cash equivalents 394,163 4,567 389,596 Cash and cash equivalents at beginning of the year 4,567 - 4,567 Cash and cash equivalents at end of the year 398,730 4,567 394,163

Key ratios

FY2013 FY2012 Income statement

- Net cost to income ratio 18.0% 18.2%

- Gross cost to income ratio 27.7% 26.0%

- Gross arrears (R’000) 1,900 1,400

- Gross arrears % of total collectibles 0.6% 0.7%

Balance sheet

- Gearing 10.7% 6.2%

- NAV per linked unit (cents) 1,243 1,081

- Linked units in issue (thousands) 317 220 170 000

Balance sheet – IPF poised for growth

• Significant headroom to pursue attractive acquisitions, quickly • Max target of 35% will ensure headroom is always available • 75% of debt fixed

Low gearing – 10.7%

• R3bn DMTN programme – R450m used • R500m bridge facility – unused • Term debt – syndicated SPV structure in place

Debt facilities in place –firm platform for growth

• Corporate and secured ratings notched up to A- and AA- respectively • Potential to issue unsecured bonds in the future

Ratings upgrades – access to cheaper debt funding

• First repayment due 2015 Debt expiry profile is low risk

Borrowings 2013 2012 R'000 R'000 DMTN programme Tranche 1 Expires 13 April 2015 3 month JIBAR + 1.40% 134,000 - Tranche 2 Expires 13 April 2016 3 month JIBAR + 1.55% 40,000 - Tranche 3 Expires 13 April 2017 3 month JIBAR + 1.65% 50,000 - Tranche 6 Expires 13 April 2017 Fixed at 8.80% 226,000 - Long-term borrowings 450,000 - Short term borrowings R500m bridge facility JIBAR + 2.25% - 130,900 Total borrowings 450,000 130,900 Gearing 10.7% 6.3% Average cost of borrowing 8.2% 7.9% Debt at fixed rates 75.0% -

-

50,000

100,000

150,000

200,000

250,000

300,000

2015 2016 2017

R'0

00

Debt maturity profile

• Overview

• Acquisitions



Portfolio composition

31 March 2013

Revenue GLA Asset Value

31 March 2012

Office 52%

Industrial 39%

Retail 9%

Office 26%

Industrial 65%

Retail 9%

Office 57%

Industrial 34%

Retail 9%

Offices 42%

Industrial 35%

Retail 23%

Office 16%

Industrial 51%

Retail 33% Office

36%

Industrial 24%

Retail 40%

Geographic spread

2% 1%

72%

2%

4%

4%

1% 14%

By GLA

Eastern Cape

Free State

Gauteng

KZN

Limpopo

Mpumalanga

North West

Western Cape

1% 1%

67%

9%

5%

2%

1% 14%

Geographic spread by revenue

Eastern Cape

Free State

Gauteng

KZN

Limpopo

Mpumalanga

North West

Western Cape

Tenant spread

43%

57%

Single vs Multi-Tenanted by Revenue

Single-tenanted Multi-tenanted

73%

15%

12%

Tenant profile by Revenue

A B C

Forward lease expiry profile

15.3%

13.2%

11.1%

20.2%

10.9%

29.3%

13.6%

11.6% 11.8%

17.0%

11.5%

34.5%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

40.0%

2014 2015 2016 2017 2018 April 2018 Onwards

GLA

Revenue

Vacancies

7.3%

92.7%

1.8%

98.2% 2.5%

97.5%

-

50,000.00

100,000.00

150,000.00

200,000.00

250,000.00

300,000.00

350,000.00

Office Industrial Retail

GLA

(m

2 )

Tenanted Vacant

Total portfolio – 2.9%

Leasing activity

(m²)Ave

R/(m²) (m²)Ave

R/(m²)Ave

Escalation (m²) Comments

Offices 6,759 80.04 - - - (6,759) BCX Vacated

Industrial 10,231 30.12 16,752 32.18 9.2% 6,521 New letting

Retail 992 143.02 776 125.82 7.1% (216) Minimal expiry

17,982 54.81 17,529 35.25 8.9% (452)

Net gain /(loss)

Sector

Expiries/cancellations

Renewals and new leases

Disclaimer

The information contained herein is for information purposes only and readers should not rely on such information as advice in relation to a specific issue without taking financial, banking, investment or professional advice. Although information has been obtained from sources believed to be reliable, Investec Property Fund Limited (Reg. No.2008/011366/06) and or any affiliates (collectively “Investec Property”), do not warrant its completeness or accuracy. Opinions and estimates represent Investec’s view at the time of going to print and are subject to change without notice. Past performance is not indicative of future returns. The information contained herein does not constitute an offer or solicitation of investment, banking or financial services by Investec Property. Neither Investec Property nor Investec Bank Limited shall be held liable in respect of any claim, damages or loss of whatever nature arising in connection with such information. Investec Property accepts no liability for any loss or damage of whatsoever nature including but not limited to loss of profits, goodwill or any type of financial or other pecuniary or direct or special indirect or consequential loss however arising, whether in negligence or for breach of contract or other duty as a result of use of or reliance on the information contained in this document whether authorised or not. This document/publication may not be reproduced in whole or in part or copies distributed without the prior written consent of Investec Property.

P 38 I Strictly private and confidential

Documents

Results presentation FY2013 · 2013-03-31 · FY 13 highlights Full year distribution of 99.99 cpu – 7.5% increase on prior year Final distribution of 53.16 cpu – up 7.9% on 2012